Transcription
Hello everybody. This is Holmes Osborne. I am uh the uh founder of this little podcast Conversations in Capital and we are having uh Dr. Marc Faber, editor and publisher of the Gloom, Boom, and Doom Report, www.gloomboomdoom.com.
Uh do me a favor, visit Dr. Faber's website. Do me a favor and like this uh podcast and put it on your social media so people can learn about awesome [clears throat] economists and money managers like Dr. Faber.
Uh Dr. Faber, where where are you calling us from? Are you in Are you in northern Thailand?
Yes, I live in Chiang Mai, which is in the north of Thailand, bordering essentially Myanmar and Laos. I mean further north, China. Uh very, very nice. And you you moved to Asia many, many years ago, didn't you?
Yes, in 1973 I started to work on Wall Street in 1970, and then in '73 I moved to Hong Kong to open the offices of the investment bank I was working for at the time.
What was Hong Kong like back when the British controlled it?
Well, it's funny you're asking this because the best way to sort of visualize Hong Kong the way it was in the '50s and '60s is to watch the movie Suzie The World of Suzie Wong. I think it was filmed with Nancy Kwan and with uh William Holden. And then there is a very good movie that I think is is actually rather entertaining with uh Clark Gable. It's called The Soldier of Fortune. And that shows a bit the way Hong Kong used to be a very free-wheeling sort of city. Whereas now, it's still free and it still functions well. It's very safe. And I have to say that under Chinese leadership uh not all that much has changed for the worse. >> [laughter] >> That many things are better now.
Have you read the the the James Clavell novels of uh Noble House.
Yes, I got that's one of my favorite books. Oh, love that book. That's what sold me on Hong Kong was reading reading his no- I think I read every novel that he ever wrote. And I I've ended up investing in Jardine Matheson and Swire Pacific because of that book. And that's one of my favorite ways as a Westerner for me to invest in Asia as it as it makes a little bit simpler for me. And Jardine has a nice dividend and I know what a big fan of dividends you are.
Yes. And I also own Jardine's, the Jardine's carriages and Jardine Matheson and DFI, the duty I mean, the the shopping centers they have. Uh and so forth. I mean, there's value in the stock because it sells at a huge discount to net asset value. I also own Hong Kong Land. And I also own the Swire companies. Because the Swire companies are of very high quality in terms of the management philosophy is one of very high ethics. Uh Jardine's I suppose nowadays also. But >> [laughter] >> it hasn't been the case always.
Well, not 200 years ago when they were running opium to China, they were kind of naughty, Dr. Faber, but that was 200 years ago. >> That everybody did that. Everybody >> [laughter] >> you mean the China. I know they did. I know they did.
So, um where you're always I wanted to ask you about the future. I know I know that you're concerned about money printing and the amount of debt in our world. And after the the 2008-2009 bubble, I thought that the rich would get to poorer and the poor would get poorer, but it turned out that the rich got richer and the poor got poorer. The next bust that we have, do you think that the rich and the poor are going to get poorer or do you have an opinion on that?
I'm glad you're actually observing that because it's been my opinion that the economic environment of the last, say, 15 years or after 2000, actually after 2000, has been an environment which has been very favorable for asset owners. In other words, the rich, the 1%, and I'm not complaining because I also have assets that have gone up in value, and presumably you, too. But as an economist, I think it's a disaster for society if the rich become not rich because they create necessarily something, but through the impoverishment of the majority of the population. And you know, you look at the standards of living in the US. For roughly 60% of the people living in America, they live paycheck to paycheck. They have basically no money. They have salaries and so forth, but they don't have much in terms of emergency budget if an emergency occurs. Or if they suddenly want or have to buy something and or spend money on an insurance premium or something like this, then they have to go into debt. And uh the wealthy people uh they basically don't care about monetary inflation. In fact, they encourage it. I mean, the whole system of Wall Street is based on rising asset values because they earn their fees on money that they manage and the money that they manage increases the fees as the money becomes bigger and bigger. >> [laughter] >> Their performance goes up. Then they they all benefit.
So, do you think the next bust, do you think it'll it'll bring everybody down? Or you know, like like after 1929 back in the good old days when we couldn't print money, everybody became poorer after 1929 in the 1930s. The rich became poorer and the poor became poorer and and I'm just curious about the next bust. What's What's going to happen in the future?
Well, Holmes, this is a question I've been kind of pondering about for some time because usually what the majority of of what people think of inflation is they go to supermarket and the prices of goods they want to buy has gone up or if they rent an apartment uh the rent goes up so that is something that hurts them or necessities like pharmaceutical products or the school fees for their children they go up so it hurts the budget of the household because their wages usually do not go up at the same rate than the price increases. But there's another type of inflation, this is also coming from monetary inflation is when home prices go up. Then in America the home ownership rate is relatively high so the population benefits from rising home prices. The stock prices go up they call it a bull market but basically it's produced by monetary inflation. And as stocks go up who benefits? The shareholders. Now who are the shareholders? They the 10% of the population they own maybe 90% of all stocks. So and the 1% they own 70% of all stocks. So these people they don't care about the grocery bill in the supermarket. They care about where the stock market goes. And we've seen this now very clearly. So as soon as the stock market goes down, Trump and these cronies, they will take measures that please the the Wall Street crowd and the stock market goes up again. So, it's not a question of Israel or not Israel or Iran or not Iran. It's a question if the stock market goes down, you can be sure they'll find a solution to the war. And if the stock market goes up, then big they become again more hawkish. But Trump, he wants to be get reelected. And in these midterm elections, he wants to do well. So, now he's taking measures to appease the capital market. You know, when I grew up and when I started to work in 1970, the capital market, the stock market and the bond market were small as a percentage of the economy. Say the stock market in America in the throughout the '70s fluctuated between 10% of GDP and say 30% of GDP, more or less that. Now, it went to 150% of GDP. When I started to work in 1970, the bond issues of $50 million were considered very large bond issues. Nobody issued ever anything close to billion dollars. Now, there are regularly issues of several billion dollars. It's like nothing. That purchasing power of money has diminished. The in in German, we say Das Geld wurde verwässert. Verwässert means It's like becoming A good whiskey you You throw water at it. And then there's this much whiskey in it and this much water. This is now the situation. And Nowadays It's not the economy that determines what the stock market will do. It's the money printing that determines what the stock market will do. And in my opinion As long as the stock market goes up It liquefies individuals. And so they can spend and the economy looks okay. But in real terms adjusted for inflation households suffer. Because the cost of living go up more than the salaries. And the price of gold has been reflecting that. This loss of purchasing power of money.
And you started buying gold in the early 2000s late 1990s?
Actually I started buying you know every month a little bit of gold because I wasn't very rich at the time in the mid-80s. Okay. All right. You're very patient. >> And I continued to do it. I mean If you ask me Mark you have to go away for 10 years or 20 years You have to go to jail because we in the financial sector are likely to end up in jail one day. >> [laughter] >> And you can't look after your money and so forth. And you want to preserve The purchasing power of your money. Then I would say gold is a good uh instrument for the preservation of capital. I'm not suggesting here that gold performs better than Apple has performed over the last 20 years or better than Google has performed over the last 20 years and so forth and so on. I think if you own the right stocks, you should be outperforming gold. But the risk profile is very different.
Are you bullish on on on the doctor your 10-year analogy? Would you buy copper and corn and silver and platinum and uh other things like that? Do you Do you have a 10-year time horizon on those other commodities?
Yes, since you live in Kansas City, this is a major grain hub. Uh I would say that grains are the commodity that are still very inexpensive at the present time. And I think it would be good to have some exposure to agriculture. But there are not many companies that offer a good exposure. You can buy fertilizer companies and so forth. But I remember in the '70s, fertilizers didn't do all that well because uh their cost went up. It's the same nowadays. Uh people think, "Well, the the cost of everything goes up and the the corporations will benefit." But that is not the case. Uh eventually, what can happen is that the asset inflation we had asset inflation I consider to be stocks going up, real estate going up residential real estate and commercial real estate collectibles and so forth and so on. That is essentially the asset inflation. That is turns into an asset deflation. And I want to stress here people have an example how this can happen. First of all they used to buy commercial properties. Now commercial properties in most American cities have gone down significantly. In some cases, 80%. I've seen buildings they sold for several hundred million dollars in 2018 and now they're selling for 20 million. And so you can have a you know, money printing, but that is the problem of money printing that not everything goes up exactly the same way. What happens is money printing lifts this asset class, say stocks and then it will lift bonds or commodities or gold or precious other precious metals like silver and platinum. But it doesn't lift everything the same way. And so at every time in an inflationary environment some people benefit but a lot do not benefit and lose. I mean, you look at the stock market nowadays. Just look at the list of new highs. It's very disappointing. Very few stocks are making new highs. Because the stock market is driven largely by the seven magnificent stocks and semiconductor. And I've noticed that a lot of these quote unquote emerging market funds, you would think by the name of the funds that they would be investing in small companies throughout Asia and South America. But the irony is is that they're not investing in these small small companies. They're investing in microchip companies like T TMC out of Taiwan and and the big the big microchip companies out of Korea. And the name the names of these developing funds are quite misleading.
Yes, but they have to invest in everything that moves. You understand? If I have an emerging markets fund and I invest say in Taiwan and so forth or or South Korea, which is even more pronounced, and my funds doesn't move or moves up a little, and the index is up 100%, then investors will say, "What kind of an idiot is this guy?" I know. And then the fund manager is under pressure from the investment community to invest in things that go up. You know, who just wrote about that Jeremy Grantham in his latest book on the economy? He talked about uh the the risk a money manager faces is keeping his own job.
Yes. Yes, but that's true. You know, across the country these AI centers, there's a there's an AI center I'm following where where I grew up on the east side of Kansas City. I was born in Independence, Missouri, which is where President Truman was from. So, Dr. Faber, there Do you remember a Dutch company named Yandex that used that's called Nebius? It used to be the quote-unquote Yahoo of Russia. Well, anyways, you remember them? So, they invested in Russia, they lost their assets. And they're financing this this AI data center in Independence, Missouri. So, the way that they're financing it, Dr. Faber, is is it's 2.1 million square feet, which is absolutely enormous. The city's going to own the AI center. So, Nebius is going to pay rent, so eventually it's it's a it's a payment in lieu of taxes, $34 million a year, which isn't a lot of money. But the problem, Dr. Faber, is that the city of Independence owns the same. They're issuing municipal taxable municipal bonds. So, I asked my friends, who are going to invest in in in municipal bonds backed by an AI center? And they said, well, if it yields 7%, there'll be some fund out there that invests in it. But the irony of this whole thing, Dr. Faber, it's all predicated upon a bull market. All these AI centers are predicated from funding of a bull market. And this is only one that I know of. Do you Do you know of any other things in this space or anything that concerns you or anything interesting?
Well, my observation is that the capital expenditures relating to data centers to support the AI activities are huge as a percent of the economy. I mean, this is a huge capital spending boom. And usually, I'm not saying in every case and every time, but usually what happens, especially in a time of monetary easing, is that huge overcapacities develop. Now, is it going to be tomorrow or in 5 years that the overcapacity manifests itself? We don't know, or I don't know. Maybe some experts would know. But I don't know. But when it happens, I tell you, every capital spending boom, whether it's construction of canals, of railroads, of interstate highways, and so forth, has produced excess capacities and massive quantity of bankruptcies. All the canal companies in America, including the most successful canal that was ever built in the world, the Erie Canal, went bankrupt. All of them. That's amazing. >> And the one that is also very successful, the Suez Canal, they was expropriated from the Lesseps family. Ferdinand Lesseps had built the canal. He also built the Panama Canal. But then he failed in the Panama Canal, but he was a brilliant engineer. I just got back from Colombia, from Medellin, and as you know, the United States uh took all took Panama from Colombia 100 120 years ago.
Um Private private They they put their hands into the cookie jar. They do. Whenever they find one. They do. Um a big portion of my business is is fixed income and is safe investments. So, I get my clients 5, 6% corporate bonds and I get them 4% municipal bonds tax-free. So, I run across private credit a couple of years ago and they're getting 12 and 13%. I said, "Well, gosh, that doesn't make any sense. You're You're getting way more than I am. You're getting more than double in private credit." And I said, "This is unsustainable." So, I open up these private credit funds and I look at the uh the underlying companies and they're stuff like stamps.com, stuff that I didn't even know still existed. Do you have an an opinion on private credit, Dr. Faber?
Yes, I mean Wall Street is very good at inventing again and again something that is of higher risk where they made money and then they offloaded to the clients and so forth. And I used to work for Drexel Burnham Lambert. So, if you're in fixed income, you should be familiar. Before that, I worked for White, Weld which was also along with First Boston, more of a sort of a fixed interest securities firm in Europe. They were with S.G. Warburg and Warburg and Company in London, the founders of the Eurobond market. So, I'm very familiar with fixed interest investment, especially through my background as having uh run the offices for Drexel in Asia. But, uh you can see the credit cycle is always the same. It starts with companies issuing quality credits and as the bull market rolls on and so forth, the quality diminishes continuously and especially in a money printing environment, that that quality is thrown out of the window and the government by government, I mean the Federal Reserve and the Treasury Department, they pushed people into higher risk through artificially low interest rates until August 2020 before they increased rates. But do you understand when there's no interest rates at all then every human being a fund manager rushes into sort of what way you can get some high yield. And so that private credit boom started largely because of artificially low interest rates created by the Federal Reserve. It did. I mean when when you go into one of these big Goldman Sachs type companies and they say, "Well, would you like to have a 4% municipal bond or would you like to have 13%?" And then the broker says, "Well, listen, I can make a few basis points off that that municipal bond or I can make 100 basis points off that credit private fund." That's a pretty pretty easy sale for that salesman, isn't it, Dr. Faber?
The salesman, he gets 5%. >> [laughter] >> Let's go work for for Goldman Sachs, Dr. Faber. It sounds like a good gig. >> [laughter] >> I'm not saying that in reference to Goldman Sachs but I can tell you the high deal yield department at Drexel Burnham was incredibly profitable. They made all the money for the firm, basically. They had a good run in their glory days, didn't they? That was quite a quite a firm.
Um weight loss drugs. I've noticed that a lot of these companies that I thought that would go on forever and ever. We used to own Heineken and a lot of these wonderful firms and and InBev and Diageo. It It looks like they've hit a bump in the road with this Nestle and and Hershey. Do you Do you have an opinion on on these weight loss drugs and how they affect the economy?
I I don't have a much of an opinion on weight loss drugs uh because I don't take them. I don't take actually any drugs. But I have an opinion Diageo and uh Heineken and the beverage stocks. The beverage stocks have come under a lot of pressure over the last 2 years. And I can tell you why. The young people, the generation Z, they're not like your generation and especially mine. We >> Especially your Especially your generation and the generation before your generation. >> [laughter] >> We used to go after work to a pub and drink limitless. And if we went to a bar somewhere, we paid drinks to the girls and so forth. Or we went to nightclubs. Life was very different. The young generation, they may sometimes go to bar, but you will find them more at Starbucks. And they don't drink much. They take drugs. Yeah. That in my days didn't exist to a large extent. I know that at the beginning of the century of the 20th century, people used a lot of heroin and morphine as a drug. But in my days, basically the people, if they wanted to have a good time, they went to party, they got drunk. And we as as students, and I belonged to the student team, the Swiss ski student team, we traveled a lot. We drank the whole time. I mean, that incredible quantities. Now there's the ski teams, they're regimented and their sponsors looked that these people are kept very in a very tight way. They can't do that anymore.
No, the world's changed, hasn't it, Dr. Faber? But we we we drank a lot. And my generation is dying out. I'm one of of the few people that still goes out because I play pool. But at my age, most people don't go out anymore. And so I see the young people, they spend much less money on drinks than we used to do. I mean, we used to do to spend all drinking. And so the stocks of beverage companies, whether it's a Remy Cointreau or whatever, they went down a lot for the last few years. And as they went down, like luxury goods, they also went down. Uh they have become relatively cheap. And I think the stock market will deflate, in other words, go down to such an extent that people will be so depressed that they will smoke again and they will drink again. >> [laughter] >>
What is is marijuana accepted in Thailand or Hong Kong or is it illegal?
It's in Thailand it's not illegal. But it's not entirely legal. I mean people can smoke marijuana. There is but they take also lots of other drugs and so forth. And I always argue, you know, on a campus in America it's much more difficult to obtain a beer than drugs. It is. And I in my opinion what they should have done is to keep actually the taxes on alcohol low and encourage people to drink beer and encourage people to smoke cigarettes and encourage people not to take drugs. But the exact opposite has happened. And why? Because drugs are unbelievably profitable. And they used to be in the hands of the mafia. But nowadays the government has become the mafia. They took over the methods of the mafia and installed it in the bureaucracy. And that's why we have such disastrous governments everywhere, not just the US.
You know something else that the government's gotten into is gambling. In the glory days the the mob would run the numbers and a tiny handful of people gambled and now if you go in a convenience store in the United States, you're going to be stuck behind someone buying lottery tickets wasting their their paycheck on something that the odds of them winning is is quite slim. Sports betting has become huge. It has become huge and it's it's respectable, which is sad because it's just another form of gambling. >> [laughter] >>
Yes, I am. I agree with you. But I mean, I'm ultra capitalist. But I can see that capitalism has some limitations. And in my view one would have to establish sort of a the government should establish very clear guidelines. Like in soccer, when you play soccer there rules. And there's an arbiter and he will decide what if a player made a foul and so forth. The capitalistic system functions best if it's very free and free of regulation and of government intervention. Trump as an example, I would have voted for him because he's better than the Democrats. But he is an unbelievably stupid interventionist. Has to intervene into everything without any knowledge at all. Plus he's of course a completely incompetent military leader. Complete incompetence.
What's going on in I Iran right now? I haven't been I haven't followed it in the last day or two. Have you followed Iran and what we're doing over there in the last day or two?
Well, you better call the White House because they change their mind every 10 minutes.
I understand. You're bullish on Asia, is that is that correct?
Look, let's put it this way. I have many friends and they travel between Asia and Europe and so was and when they Europe when they're in Europe, they tell me, "Mark, I can't wait to get back to Asia." And I think in Asia we have not exactly uh well-functioning democracies. They in Hong Kong and Singapore, you have sort of democracies, but then they are not really democracies. But the system functions reasonably well. And in Thailand, which is a among the economists, they call Thailand a failed state. But life here is very nice. There's very little criminality. Uh you can see my office here. It's a very large office and so was and uh I don't have a key. The door is always open. Really? Yes. That's fascinating. >> I sleep upstairs. My bedroom is upstairs. But uh basically you know what but uh I'm never concerned about anybody coming in. Now, it could happen. I'm not saying it's never going to happen. But the likelihood is not very high.
You're a national treasure, Dr. Faber. I'm going to have to pay for security out of my own pocket to make sure nothing happens to you. Haha.
There's nothing to steal, you mean? >> [laughter] >>
Uh health care. I'm guessing that at at your age and by the way, the viewers, Dr. Faber's 80, he looks like a million bucks. He handsome guy, takes care of himself. Um Other people take care of me. You're you're okay, wonderful. So that So that So that gets to health care. You must have doctors that you like there in Thailand.
No, actually I stay away from hospitals and uh of the pharmaceutical industry. But I take uh some supplements like vitamin C or turmeric and I take uh all sorts of seeds and uh magnesium and zinc and stuff like this because when you age your kind of uh resistance diminishes. Mhm. So it's advisable to take supplements and to to stay healthy. But the the the healthiest supplement I take is whiskey and beer and cigarettes.
What's your favorite whiskey, Dr. Faber?
It's difficult to say because for different occasions you can drink different whiskey. Okay. For day-to-day usage for usage like when I'm working or when I'm giving an interview, I would take uh Johnny Walker Red Label.
That's a good reasonably priced uh scotch, isn't it?
It is. It is like a daily scotch. It is. And uh I I have an equal quantity of Chivas, which I store. But for me, the Chivas is almost too smooth. It's very smooth, nice whiskey. Or the Black Label or Blue Label is very nice. It's a great whiskeys. But I prefer sort of the working man whiskey, which is in Scotland. Uh Red Label. Yes. I took my daughter when she was 12 to Edinburgh, and if she wasn't with me, we were right across the street from the Johnny Walker headquarters in Edinburgh, and I couldn't go in because I had my child with me, but I really wanted to go in. >> [laughter] >>
What's your What's your favorite beer? You said You said you like beer. In America, I drink Sam Adams.
Oh, do you really? >> I think it's a very good beer. What are you drinking in uh Budweiser for me, my I might as well drink water. I might as well drink urine. I would never I can't stand Budweiser. It's a horrible horrible beer.
I know it is. >> in Thailand, we have two major brands. Uh one is of course well known through the Thai restaurants, the Singha beer. My wife used to have the agency in Hong Kong. Really? >> And I like Chang beer. Okay, I'm not Who Who owns them? Do you know who owns them?
Yes. Uh the the the Singha beer is privately owned. Okay. And by a family. And uh >> Okay. the Chang beer belongs to a company. They He was a very successful businessman. He started essentially with nothing. And he assembled brands like Mekong whiskey and Sang Som. He has like a monopoly of whiskeys in Thailand. But they're not really whiskeys. They're closer to rum. Really? Yes. What are they made from? Sugar? Like I suppose they're made from sugar. Oh. I don't drink. I drink occasionally. But the local population, you see, a beer I can't now explain exactly the value of money in Thailand. But a beer is say for 40 baht in the shop, in a restaurant or bar, it's say around 100. Now, five five beers is easily to be drunk in one evening by someone. That's 500. This is relatively expensive for a Thai. So he buys a bottle of Sang Som. And he can buy the bottle, a liter or 0.7 for maybe 4 500 baht in the restaurant or in the bar.
How many What's the What's the baht What's the baht to dollar exchange rate? Do you know approximately?
>> Yes. It's about 32.4 today. Wow. $1 32 baht. Wow. So if you want to go out and have five beers, it's like 15 American dollars. Yes. That's a lot of money for a Thai person. >> drinks for the girls, the the drinks for the girls are relatively expensive.
Well, you got to buy drinks for the girls, doctor. There's There's We always budget drinks for the women. That's one of the highest budgets. That's the number one budget.
What kind of cigarettes do you What are your favorite cigarettes?
I smoke Marlboro Lights. Oh, nice. Okay, good. Keep Keep Philip Morris International going.
All right, Dr. Faber, any any parting thoughts? We're about 45 minutes in here. Any parting thoughts or anything that you want to talk about?
Well, I mean, you mentioned that you focus a lot on fixed interest securities. To that, I'd like to add the following. If you look at portfolio allocations, you know, stocks, uh commodities, real estate, how people invest their assets. Because we had this asset inflation essentially since 1981-82, in the case of bonds, the peak in interest rates was September '81, and the stock market, as you remember, the low was August '82. Since then, everything has gone up. And so, the public is sort of uh conditioned that interest rates go down and stocks go up. But, I think a major turning point came in 2020, and from here onwards, we have a rising tendency for interest rates. In other words, bonds are not a good investment, but if you look at the '70s, the bond market reached, say, around 6% on Treasuries in 1970. Then, we went to over 12% in '73, '74, and then we fell to less than 6% in '76 and then we went up again and fell and up again. So, there were huge trading opportunities in bonds. And as of today if I look at bonds and stocks I think people who buy treasuries will lose less money than people that buy stocks. That's why I'm doing this. And And as a matter of fact, in in spring of of 2000, like you mentioned we sold off some of our bonds and bought stocks. And uh I'm not I don't know international markets as well as you do, but I know them better than the American average American advisor uh having gone out of the country six times last year. And this this year I've already visited five countries. And I was able to invest in Latin America. And And as you know, there's a lot of great companies down there like uh Coca-Cola FEMSA and Vale out of Brazil and Ambev out of Brazil. But uh you know, it it
Do you see a scenario where inflation takes off and interest rates spike uh and then property drops in value, the stock market drops in value, bonds drop in value. Do you see a a a situation like that, Dr. Faber?
Yes. Yes, I mean this is a a question that I can't answer in 3 minutes because what can happen is in the current environment and under the Trump administration it is likely that inflation will accelerate and that bonds could tumble. But the market you understand? People are invested in assets. If their residential properties go down and if the stock portfolios go down, in my view, they will curtail spending. In other words, which is this already happening at the present time, that most households are struggling because the cost of living has gone up more than the salaries. And when this happens, the economy will turn obviously sour. And my view is the Trump administration is lying massively about the state of the economy. The economy is much weaker than what they publish. And the Fed chair uh Powell, he sort of admitted that he said the labor market doesn't feel like the unemployment rate is around 4 and 1/2%. Do you know what I mean? That the labor market is sort of slack. And uh my view is that bonds could rally here. I I'm long on bonds at the present time. And I'm buying bonds and I want to explain you why because I have all through my business plenty of cash. And in the last 2 3 years, you know, I got 4% 4 and 1/2% on the cash, which was very high compared to zero before. So, I was very happy. But my risk is that if Fed if Trump passes way and he cuts the Fed funds rate to 1%, we have very low short-term rates and you and I as a depositor don't get anything. So, why don't we lock in some money at as you said for corporate bonds we can get say 5% for 5 years. I I don't think the stock market will go up by 5% per annum for the next 5 years. I tell that to people all the time. I say how much money do you really want to make? I can if I can buy a 6-year corporate bond that goes out 20 years what's wrong with 6%? That's a pretty good rate of return, isn't it? Yes, I think so. I think it is. Historically and and what are the odds that the stock market's going to do 6% over the next 20 years? Pretty slim. Yes. And that people own the stocks that are in there that go up. Exactly.
All right, Dr. Faber. >> at the last few years they invested in cannabis stocks. You remember ACB and so forth. And then were the meme stocks, GameStop and AMC and so forth. The public is specialist in buying high and speculative stocks that disappear. I know. And it looks like one of them reared its ugly heads trying to buy out eBay. Did you read that? Yes. >> [laughter] >> It's a joke. Uh all right, Dr. Faber. It's 50 minutes. You're the best. Appreciate it. The best I don't know.